CESTAT AHMEDABAD: Deposit Rs.25 lakhs in 12 weeks for waiver of pre-deposit; emphasize prima facie case.

The Appellate Tribunal CESTAT AHMEDABAD, in a case concerning alleged clandestine removal of goods without paying Central Excise duty, directed the appellant to deposit Rs.25 lakhs within twelve weeks. Compliance with this directive would lead to a waiver of pre-deposit for the remaining amounts, with recovery stayed pending appeal disposal. The tribunal emphasized the need to establish a prima facie case for seeking a waiver of pre-deposit in cases involving excise duty disputes, maintaining a balanced approach between revenue protection and due process.

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Issues:
- Stay petition for waiver of pre-deposit of duty, interest, and penalty due to alleged clandestine removal of goods without Central Excise duty discharge.

Analysis:
The judgment by the Appellate Tribunal CESTAT AHMEDABAD, delivered by Mr. M.V. Ravindran, dealt with a stay petition seeking a waiver of pre-deposit of duty amounting to Rs.52,48,132, along with interest and penalty equal to the duty. The adjudicating authority had confirmed these amounts due to the alleged clandestine clearance of goods from the factory premises without paying the appropriate Central Excise duty. The tribunal heard arguments from both sides and reviewed the records presented. The appellant's Chartered Accountant highlighted the Order-in-Original, the Show Cause Notice, and other documents to argue against the allegations of clandestine removal of goods.

Upon examination, the tribunal found that the issue revolved around the clandestine removal of 'Chhakkdo Rikshaws'. The adjudicating authority had made a reasonable finding based on evidence, including under-valuation of the rickshaws cleared from the factory premises. The appellant's proprietor had admitted to procuring diesel engines and gear boxes under fictitious names for manufacturing and clearing the rickshaws. Despite the legal points raised by the Chartered Accountant, the tribunal concluded that the appellant had not established a prima facie case in their favor at that stage. Therefore, the tribunal directed the appellant to deposit Rs.25 lakhs within twelve weeks and report compliance by a specified date. Upon compliance, the waiver of pre-deposit for the remaining amounts was allowed, and recovery stayed pending the appeal's disposal.

This judgment underscores the importance of establishing a prima facie case to support a stay petition seeking a waiver of pre-deposit in cases involving allegations of clandestine removal of goods and non-payment of Central Excise duty. The tribunal's decision to require a partial deposit and subsequent compliance reflects a balanced approach to addressing the issues raised while ensuring the interests of revenue protection and due process in the adjudication of appeals related to excise duty matters.

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